"The market is nervous that in the near term, with earnings coming out in the next couple of weeks, it will be a bumpy ride," said Robert Harrington, co-head of listed block trading at UBS Warburg.

In early afternoon trading, the market's major gauges were lower. The Dow Jones industrial average was down 4.13, or 0.1 percent, at 8,217.20, having broken a two-day losing stretch on Thursday by rising 23.39.

Investors are paying close attention to the economy and first-quarter earnings results, the bulk of which will be released during the next two weeks. Analysts say investors are less concerned about the war with Iraq now that allied success seems assured.

The Commerce Department said retail sales increased by 2.1 percent in March, much better than the 0.6 percent rise economists predicted and an improvement from the 1.3 percent drop in February. Much of the strength was owed to automobile sales, getting a boost from positive financing and other incentives.

And, consumer sentiment improved more than expected in recent weeks, according to the University of Michigan's mid-month survey of consumers as reported by Dow Jones Newswires.

The report on consumer sentiment for April was said to have shown an increase to 83.2 from 77.6 in March, well above expectations for a smaller increase to 78.0.

But on the downside, the Labor Department reported that wholesale prices jumped by 1.5 percent last month due to a surge in energy costs leading up to the war. The increase in the Producer Price Index, which measures costs before they reach consumers, was much bigger than the modest 0.3 percent advance economists had forecast.

Earnings news was also varied.

Baker Hughes fell $1.05 to $29.34 after warning of lower-than-anticipated profits. But Juniper Networks rose 65 cents to $9.06 after beating first-quarter earnings estimates by a penny a share.